China has ordered its top four state-owned banks to issue offshore loans to help developers repay overseas debt, three people with knowledge of the matter told Reuters, rolling out its latest support measure for the cash-starved property sector.

The regulators have given 'window guidance', or verbal orders that leave no paper trail, to the banks, setting a date of Dec. 10 by which to make the loans secured against domestic assets, two of the sources said.

China has stepped up support measures in recent weeks to free up a liquidity squeeze that has stifled the sector, which makes up a quarter of the world's second-largest economy and has been a key driver of growth.

A growing list of developers have defaulted on overseas creditor obligations over the past year, prompting some analysts to warn that such disruptions could blunt foreign investors' appetite for fresh debt issuance by Chinese companies.

Funds received after the latest step will allow developers to repay offshore loans and dollar bonds in a bid to repair global investors' bruised confidence in the sector, two of the sources said.

Developers seen as being of "good quality" from a balance-sheet perspective, such as CIFI Holdings, Country Garden, Longfor Group, Midea Real Estate and Seazen Group will qualify, one source said.

Each of the four banks, Bank of China, China Construction Bank, Industrial and Commercial Bank of China and Agricultural Bank of China, will pick several developers to fund, the three sources said.

Each bank will process three to four offshore loan proposals that will be secured against developers' assets in China, said two of the sources, adding that Beijing would expand the scheme later by adding more banks.

The People's Bank of China, the central bank, and the China Banking and Insurance Regulatory Commission (CBIRC) did not immediately respond to Reuters' requests for comment.

The big four banks did not respond to requests for comment, nor did representatives of CIFI, Country Garden, Longfor, Midea Real Estate and Seazen. (Reporting by Julie Zhu in Hong Kong, Engen Tham in Shanghai and Xu Jing in Beijing; Editing by Sumeet Chatterjee and Clarence Fernandez)